Deep forces are at work changing higher education globally. The pandemic has sped some of them up, but they were at work anyway. Maybe it has always been thus, but throughout our lifetimes these forces have been benign, favouring expansion and generating optimism in and about higher education. Now they are disruptive and, for some, troubling.
Long-held beliefs from human capital theory since the 1960s justified higher education expenditure as an investment in the economy. But now, the return on an individual’s investment is declining, employers are grumbling and governments want to put public money elsewhere. The yield for the economy is starting to look less obvious compared with alternative uses of money.
Long-held beliefs about equal opportunity justified higher education expenditure as a way of promoting intergenerational mobility and breaking cycles of entrenched disadvantage. And yet, inequality has risen during the era of mass participation in higher education. One obvious reason is that if we confer a wage premium on 40% of the young population, over time those cohorts will break away from the other 60% and transmit the advantage to their own children. And now, vocational education is in a real mess in many countries, including Australia; a casualty of privileging knowing why over knowing how.
Masking these trends has been the boom in international education, as power and wealth re-balances across the world, generating huge middle classes, enough of whom, to date, have wanted to send their children overseas. The fate of international education hangs in the balance, but Australia should brace for the possibility that the China market never fully recovers for Australia, and there is no single replacement source on that scale.
In our recent report, The Future of Higher Education in a Disruptive World, we set out these arguments more fully, and argue that universities need to decide their future deliberately: do they transform their business and operating models; do they affirm their business model but optimise their operating model; do they do nothing in the hope they have enough time to change if disaster looms; or do they do nothing in the belief that they are invulnerable?
But what about whole higher education systems? Are they just the sum of the higher education providers they comprise, at the mercy of the choices universities make (including a fifth choice, to drift along and hope things hold together until the next management team’s turn?).
Now is a moment of huge opportunity for Australia. We’ve done it before, with the Higher Education Contribution Scheme, a world-first which has been copied elsewhere, sometimes badly with the addition of national bloatware. What is our next HECS?
What about a platform university? Most of the world’s ten largest firms are platforms. Scaling up through technology is arguably the only way of counteracting “cost disease” in service sectors like education. Otherwise, as the economist William Baumol showed, their costs will go up to match the salaries of sectors that can produce productivity gains when they themselves can’t.
Why couldn’t Australia produce the equivalent of Stockholm’s Spotify: our own Unify?
It could involve quality assured aggregation and curation of content drawn from the best examples in our higher education providers. It would use learning analytics to personalise feedback and support progress. It could reach a mass audience, but with the option of face-to-face support from partner institutions around the world.
According to the Universitas 21 ranking of national higher education systems 2020, compiled by impeccable researchers, Australia has the 9th best system in the world, despite lower levels of resourcing than our competitors, indicating that our universities outperform our nominal GDP (14th): and we do so on a small population base (55th!).
To take the world by storm with a new kind of university would, however, need an innovative and ambitious spirit to return. Innovation in curriculum would be essential, overcoming sclerotic distinctions between what is academic and what is practical, and looking ahead to transformed economies.
The World Economic Forum predicts that the year 2025 is the year when time spent on current work-related tasks will be performed equally between machines and people, heralding a new distribution of labour between humans and algorithms. Could we be ready as a nation by 2025 with a global education offering to serve that world? Our next HECS?